Real Money

Royal Dutch Profit Surges

But the company says refining outlook remains uncertain.

Royal Dutch/Shell ( RD) is the latest oil company to say sales and profit surged in the first quarter thanks to spiking crude prices during the Iraq war.

The company said first-quarter earnings were $5.3 billion on sales of $69.4 billion in the quarter, up from $2.3 billion on sales of $47.9 billion. The company noted that the price of a barrel of Brent crude averaged $31.50 a barrel in the latest quarter, up from $21.15 last year.

Adjusted for the current cost of inventories and other unusual items, Royal Dutch earned $3.9 billion, or $1.13 a share, in the latest quarter.

As is the case with many oil stocks, the price-related spike in first-quarter profitability has not resulted in a higher stock price for Royal Dutch Petroleum, which trades on the NYSE. The shares last traded for $41.35, much closer to their 52-week low of $36.69 than their 52-week high of $57.20. The underwhelming performance reflects concerns that the war-related price environment would be short-lived, concerns that have largely been realized.

Looking ahead, the company said the outlook for refining margins remains uncertain and depends on global economic recovery and OPEC policy, particularly as it pertains to the resumption of Iraqi crude exports.